What to consider when searching for a rental investment property: location, location, location.
So, you’ve decided that letting a property is the right investment for you. Great! The decisions don’t stop here, however, and getting the next choices right will help ensure your property purchase is going to maximise the return on your investment
The first consideration you need to make is location. Where your property is situated is the number one defining feature affecting the achievable price for your property. After all, lifestyles extend beyond the four walls of a house and the neighbourhood can’t be changed as easily as the décor. Even the most stunning property in an undesirable part of town will be hampered in its appeal and cap your market value, whereas an average property in a desirable location will attract more interest from those searching for their next home. People want to relax and feel safe in their neighbourhood and have a level of convenience in accessing things that are important to them. Whether that’s being close to a good school or decent shops or the big, open spaces of the countryside, or having an easy commute to work, if you can offer an appealing lifestyle then finding a good tenant is made easier and you can charge a higher rental price.
However, there is obviously a trade-off when it comes to making your initial purchase and you are in competition with both those both looking to buy their own home and other potential landlords. Desirable properties have the potential to generate a higher monthly rent but are also going to cost more in the first place. You need to keep an eye on your rental yield to ensure that your investment is worthwhile. Besides which, a buy-to-let mortgage offer may require you to be able to prove the ability to earn a certain percentage in terms of rental yield. (We will look more closely at buy-to-let mortgage options in a future post.) Aiming for a property in the lower bracket in an appealing location with the potential for improvements can offer the best combination to reduce your purchase price whilst both earning a good monthly yield and increasing in value for sale in the long-term.
So where in King's Lynn and West Norfolk should you look to purchase to maximise your rental yield?
The answer will depend on your budget and the demographic of tenants you would like to rent to. Property close to Queen Elizabeth Hospital such as those on Bishops Park, Kings Reach or Springwood, will always be popular with hospital staff, who offer a reliable income, although are often shorter-term lets. North End properties around Loke Road are also popular with tenants looking for lower rental prices whilst the lower purchase price of properties in the area delivers a strong yield percentage. Meanwhile, families will seek proximity to schools with a good reputation and access to outdoor space. The Woottons and villages close to King’s Lynn are in high demand with this regard and tenants with families often prove to be longer-term tenants due to the desire for stability. With Norfolk offering a quieter pace of life, we are also experiencing a high demand for property suitable for more elderly tenants. Villages between King’s Lynn and Hunstanton attract a high level of demand from this demographic, with their prevalence of bungalows and sense of community.
Obviously, if you have become an accidental landlord with a property already, these options are moot. But tenants come in all sizes and with a range of needs, from individuals to couples, from families to retirees. Without the need to subsidise a mortgage, properties that would normally be out of contention in achieving a good yield still have a place in the market and without the competition of an abundance of other comparable properties, but the remit of your tenant search is likely to be defined by the sort of tenant that the area attracts.
At Brittons, we are happy to offer tailored advice on the properties that offer the strongest rental potential from those available on the market. Our small team of lettings agents are all qualified in residential lettings with experience of the West Norfolk market in particular. Why not give us a call on 01553 692828 and let Brittons let for you?